Demonstrating the potential of shared Smart Specialisation approaches to promote green transition
Summary of the case
Interregional policy learning experiments in the Baltic Sea Region (BSR) are demonstrating new ways to untap the potential of the bio- and circular economy, through projects focusing on trans-regional greening supported by regions’ Smart Specialisation Strategies (S3s). By linking their own regional priorities to Europe-wide value chains, regional authorities around the BSR are refining S3 governance structures and extending Entrepreneurial Discovery Processes (EDP) for a more systematic cooperation on closing bio-material loops.
Different BSR interregional projects have helped to reinforce cooperation around e.g. key bio-circular value chains throughout the macro-region. Supported by a new interregional governance arrangement - the ‘BSR S3 Directors’ Network’ - a stronger, sustainable footing for macro-regional S3 can be realised.
The S3 Directors’ Network initiated the ‘BSR S3 Ecosystem Platform’ project (2019-2021) that has recently delivered three reports with a strong focus on green transition, EDP and interregional S3. These are: 1) first-stage value chain mapping analysis of the Circular Bioeconomy across the BSR, 2) an accompanying value chain mapping manual and 3) a good practice study/capitalisation report based on interviews with nine BSR regions that have been lead partners or partners in S3-focused Interreg projects. Many cases of the latter study provide evidence on using S3 as a tool to foster bio- and circular economy.
Better, more fine-grained data on resources, partners, assets and infrastructures have been gathered by BSR regions, through the above efforts, to provide improved policy intelligence. New partnerships and new tools have been tested at interregional level. For example, the value chain mapping exercise for circular bioeconomy, which identifies potential for networking bio-refineries across borders.
Prospects therefore look good for further strengthening of policy cooperation, across BSR, to boost innovation in support of European Green Deal objectives in 2021-2027. Building on the strong momentum created during the current period, new perspectives are emerging from the learning gained in partnership to grasp the opportunities presented by the new Interregional Innovation Investment (I3) mechanism foreseen.
1. Territorial context and challenge faced
The Baltic Sea Region (BSR) covers Latvia, Lithuania, Estonia, Denmark, Sweden, Finland, Poland and the regions of Germany bordering the Baltic Sea, plus two non-EU territories - Norway and regions of Russia. Under the framework of the EU Strategy for the Baltic Sea Region, these territories cooperate with a view to using existing structures and funding more efficiently, through cross-border synergies, supported by EU Structural and Investment Funds under the Interreg Baltic Sea Region Programme. The three BSR cooperation domains are:
1) Protection of the sea;
2) Enhancing connectivity in transport and energy;
3) Increasing prosperity, notably through fostering innovation.
The latter goal has mobilised BSR innovation actors, who have developed multiple joint initiatives and research and innovation projects.
The BSR is well endowed with bio resources (sea, forests…) but it is also facing important challenges in terms of pollution, waste, CO2 emissions, etc. Reinforcing the bio- and circular economy in the region has been identified as a way to respond to these environmental challenges and also create new economic opportunities. Relevant resources and initiatives, however, are fragmented. By identifying and capitalising on complementarity within value chains and infrastructure (e.g. bio-refineries…), industrial symbioses and circular economies can be deployed on a wider scale.
2. Aims and ambition of the initiative
Developing bioeconomy and circular economy are priorities in many of the Smart Specialisation Strategies (S3) adopted in the EU BSR regions and countries. A range of interregional initiatives with a green dimension have been implemented, involving Baltic Sea territories in a variable geometry setting. These have shared the dual aims of drawing useful lessons for S3 design and implementation in individual territories, as well as establishing stronger cooperation along interregional value chains.
3. Content and implementation of the initiative
The following three examples of bio- and circular economy interregional projects financed by the Interreg BSR Programme provide an insight into the BSR’s commitment towards EU Green Deal ambitions.
RDI2Club (2017-2020): Biobord - Network of Bioeconomy Regions and Innovation Hubs
‘RDI2Club’ project aimed to boost smart bioeconomy development in the rural areas of the Baltic Sea Region, through enhancement of knowledge on bioeconomy strengths and actors of the project partner regions.
Main activities of the project were initially to develop bioeconomy profiles for the partner regions and SWOT analyses of the related regional innovation ecosystems. Regional action plans for each partner and a joint action plan were then established. A key output has been the creation of the ‘Biobord Platform’ - a web forum that connects bioeconomy business and research actors in the BSR, providing matchmaking services, online events,group sessions for project development and updates from the network members.
The Biobord has become an important intelligence tool for both regional bioeconomy mapping and interregional project development. It has proved particularly useful for S3 implementation in bioeconomy and is transferable to other fields. Biobord has been used to support targeted collaboration between SMEs in the bioeconomy sector from various rural areas in BSR through mutual consultations and technological support, as well as larger events: workshops, hackathons etc. Innovative solutions by bioeconomy actors featured in BioBord include:
- a small Finnish company has developed a mobile application for connecting rural entrepreneurs with services and workforce, focused on farmers in rural areas, including a location-based map as well as capacity for information sharing;
- a Latvian research organisation is developing a decision-making support tool for agricultural primary production enterprises and farms by utilising the technological opportunities offered by sensor-equipped drones;
- a Norwegian wastewater treatment plant has been converted into a ground-breaking resource recovery facility using innovative biological wastewater treatment.
The Biobord development continues within a ‘Biobord Network’ established in October 2020 between the former RDI2Club project partners. The network aims to secure the future of Biobord and further develop the bioeconomy network in BSR and Europe-wide.
BSR Stars S3 (2016-2019): Smart specialisation through cross-sectoral bio-, circular- and digital ecosystems
The ‘BSR Stars S3’ project sought to develop more integrated interregional innovation support infrastructures, linked to S3 implementation in the bio- and circular economy and digitalisation fields. The activities include:
- mapping of bioeconomy test and demonstration facilities in the BSR;
- implementation of an interregional innovation voucher pilot scheme, connecting key Nordic testbeds by offering SMEs vouchers to access testbeds across borders;
- a transnational accelerator camp as a tool to engage ‘triple helix‘ representatives from regions around the Baltic Sea, using business acceleration and value chain support methods in solving selected regional challenges related to circular economy and sustainable development.
The project resulted in transnational promotion of the circular economy in BSR by bringing stakeholders together to share information and experiences from ongoing circular economy and industrial symbiosis initiatives in various regions. A key outcome was a comprehensive list of recommendations ranging from detailed mapping of material flows to specific trans-national financial incentives.
BSR S3 Ecosystem Platform (2019-2021) : bioenergy and combining forces in biorefineries
The BSR S3 Ecosystem Platform project has made efforts to identify the scope for the networking of the BSR’s biorefinery infrastructures.
The first stage circular bioeconomy value chain mapping exercise has been completed and a related manual to support value chain mapping in the BSR context has been compiled. The manual is designed to be applicable in broadly any domain or discipline. Drawing on existing datasets, supplemented by a questionnaire (circulated for completion to 16 BSR regions from 7 BSR countries), the mapping exercise provides analytical insights on value chains in circular bioeconomy. It focuses on the most innovative part of the bioeconomy that concerns highly cross-sectoral activities, including bio-based products, cascading use, utilisation of organic waste streams and organic recycling.
Governance for interregional S3 cooperation
In 2018, the BSR S3 Directors' Network was set-up, composed of senior regional Directors who have a key responsibility for overseeing strategic direction for S3 in their regions. This strategic coordination mechanism emerged from the opportunity to capitalise on the multiple cross-border initiatives, avoiding fragmentation of efforts.
The Directors’ Network notably initiated the BSR S3 Ecosystem Platform project. The Network aims to strengthen the BSR’s collective capacity to share innovation knowledge and experience and to consider options and actions for joint S3 working across the BSR. In this way, it plays a key role in the sustainability of BSR initiatives. The Network’s post-2020 ambitions are strongly aligned to EU Green Deal objectives, supported by the twin-transition agenda in energy and digitalisation.
The BSR interregional initiatives have generated important achievements in terms of improving individual S3s based on trans-regional policy learning, as well as reinforcing cooperation around interregional value chains throughout the macro-region.
Improving individual S3s based on trans-regional policy learning
Regions involved in these BSR initiatives have improved their policy instruments for S3 implementation thanks to learning and adopting good practices from other regions. According to the Baltic Institute’s Capitalisation Report, they are now “better equipped to develop new policies and implement new technologies and cooperation models in order to move towards bio-based circular economy”.
The regions have also gained new insights for improving their S3 governance models. Strong facilitation skills and the ability to find ways to engage different stakeholder groups, through the “neutral management approach” of the bodies coordinating the cooperation initiatives, have been noted as particular ingredients for success.
As a result, involved regions have been able to further develop and refine their Entrepreneurial Discovery Processes (EDP). In concluded that:
- Regions have increased efforts towards wider stakeholder involvement in regional S3 processes, although the adoption of quadruple helix has not yet replaced the traditional triple helix approach to EDP;
- Major challenges of EDP are related to communication with the different types of stakeholders and methods of coordinating their participation in discussions so that it enhances stakeholders’ motivation and brings added value;
- A systematic approach that includes creation of roadmaps and concrete action plans for each S3 priority, as well as regular stakeholder group meetings to update the roadmaps, is effective in ensuring continuous EDP. However, domination by a few stakeholders should be avoided.
Reinforcing ‘green’ cooperation around interregional value chains throughout the macro-region
BSR regions have been able to identify cooperation partners active in bioeconomy value chains. RDI2Club, with its Biobord platform, for example, has enabled the development of S3-related European networks during their implementation. The Joint Action Plans include transnational actions and measures to be implemented in cross-regional partnerships. Biobord has generated 11 cooperation projects, fosters increased knowledge about bioeconomy opportunities and enables businesses to develop green innovations and find partners.
Regions have tried and tested new policy instruments with an interregional dimension. For example, BSR Stars S3 tested tools such as a transnational S3 accelerator camp and a transnational pilot voucher for SMEs to access bioeconomy test facilities. These are both leading to new international business cooperation projects, as well as new partnerships between technology organisations and testbeds in the bioeconomy across the BSR.
Thanks to new evidence emerging from the projects, participating regions have gained a better understanding of the potential cooperation possibilities across value chains in the macro-region. The BSR S3 Ecosystem Platform has mapped specialist expertise in relevant technologies, as well as leading firms in circular bioeconomy and developed a methodology and a manual for this mapping. The Biobord platform provides data on regional bioeconomy profiles, whilst the BSR Stars S3 project has made an inventory of test and demonstration infrastructures to benefit SMEs in the bioeconomy.
Through these initiatives and the linkages between them (e.g. the BSR S3 Ecosystem used the information base created by the BioBord platform), the S3 approach has succeeded in creating an effective basis for new avenues of cooperation on bio- and circular economy across the diversity of BSR regions.
Key success factors and hurdles for interregional S3 cooperation
The success of these interregional initiatives depends on several factors:
- Strong and continuous political commitment is a key condition for sustainability of the projects’ results and their mainstreaming into policies, at regional and macro-regional levels;
- A deliberately strategic use of Interreg programmes has been made to contribute to shared goals, rather than as a mere funding sources for constellations of projects;
- Strategic coordination - the establishment of the BSR S3 Directors’ Network has been instrumental in working towards strategic use of and synergies between projects.
Some difficulties have been encountered when analytical or policy tools have been designed too rigidly. The need to devote increased attention to adaptability to the variety of contexts across the BSR has been highlighted as a major lesson.
Replicability and transfer of experience is at the heart of each of the BSR interregional initiatives. Thanks to the continuity of cooperation beyond the individual projects, regions in the BSR have access to a permanent pool of experiences and partners in order to replicate good practices from one territory to another. One success factor for this continuity lies in the creation of policy linkages at strategic level, which are nurtured by and survive beyond the different projects. Notably, based on various BSR cooperation initiatives, the region of Helsinki-Uusimaa, the Hamburg City State, the Capital Region of Denmark and the Stockholm region have established a permanent S3-oriented strategic partnership – now also adding the Amsterdam Metropolitan Area.
The Biobord tool is planned to be maintained after the end of the project thanks to partners’ high motivation, commitment and own funding. It continues to support BSR-wide cooperation with the establishment of a formal network, providing a good basis for replication of experiments and initiatives.
“Macro-regional S3 for the bio-based and circular economy represents a real opportunity for greening our economies. The prerequisites to make it work are identification of potential transnational value chains, active involvement of public, research and business sectors and transnational exchange of expertise, leading to lasting transnational partnerships.”
Johanna Leino, the Baltic Institute of Finland
Click to see the BSR's diagram on the bio and circular economy - Source: Diana Pitkänen, 2020